Review of the Actuarial Forecasts of the Proposed Contributory Social Security Regime in Timor-Leste

This report briefly summarizes the results for the analysis of the design, financing and administrative processes for a national social security system covering all salaried workers in Timor-Leste, including analysis of the actuarial report (ACL Report) prepared for the Directorate General of Social Security by its consultant. The report is divided into seven sections: (i) Scope of Work; (ii) ACL Report Assumptions and Methods Comment; (iii) ACL Plan Design Comments; (iv) PROST Analysis: ACL Report Design, Assumptions and Methods; (v) PROST Analysis: ACL Report Design, Bank Assumptions and Methods; (vi) Social Security Pension Fund Establishment; and (vii) Conclusion. In the final analysis it was determined that the ACL report does not meet international standards for actuarial reports for national social insurance systems. Furthermore it misrepresents the long-term costs of the proposed Timor-Leste national social security system by using non-standard assumptions and methods and an unusually short analysis period. It is suggested that the government of Timor-Leste carefully consider all aspects of design and funding before adopting the new system, as the decisions made will have very significant macroeconomic, labor market, budget, and social policy implications for the country for decades to come.

Bibliographic Details

Main Author:	World Bank
Language:	English en_US
Published:	Jakarta 2014-09-14
Subjects:	ACCRUAL RATE, ADMINISTRATIVE COSTS, BANK OFFICE, BANKRUPTCY, BENEFICIARIES, BENEFICIARY, BENEFIT PAYMENT, BENEFIT PAYMENTS, CASH FLOWS, CHILD SUPPORT, CITIZEN, CITIZENS, CONTRIBUTION COLLECTION, CONTRIBUTION RATE, CONTRIBUTION RATES, CORRUPTION, COST ESTIMATES, DEFINED BENEFIT, DEFINED BENEFIT PLAN, DEMOGRAPHIC CHANGES, DEPENDENCY RATIO, DEPENDENCY RATIOS, DEVELOPING COUNTRIES, DISABILITY, DISABLED, ECONOMIC DEVELOPMENT, EMPLOYERS, EXPENDITURES, FAMILIES, FERTILITY, FERTILITY RATES, FINANCIAL ANALYSIS, FINANCIAL STABILITY, FRAUD, FULL DISCLOSURE, INFLATION, INTERNATIONAL STANDARD, INTERNATIONAL STANDARDS, LABOR FORCE, LABOR FORCE PARTICIPATION, LABOR MARKET, LARGE FAMILIES, LIFE EXPECTANCY, LONG-TERM COST, LONG-TERM COSTS, MATURITY, MINIMUM BENEFIT, MORAL HAZARD, MORTALITY, OLD AGE, PAYROLL COSTS, PENSION, PENSION BENEFITS, PENSION FUND, PENSION FUND ASSETS, PENSION FUNDS, PENSION PROGRAMS, PENSION SCHEME, PENSION SYSTEM, PENSIONABLE EARNINGS, PENSIONERS, PENSIONS, POLICY IMPLICATIONS, POPULATION PROJECTIONS, PRIVATE PENSION, PRIVATE PENSION FUNDS, RATE OF RETURN, REAL INTEREST, REAL INTEREST RATE, RESERVES, RETIREMENT, RETIREMENT AGE, RETIREMENT BENEFITS, RETIREMENTS, SANITATION, SEX, SOCIAL INSURANCE, SOCIAL INSURANCE SYSTEMS, SOCIAL PENSION, SOCIAL PENSIONS, SOCIAL POLICY, SOCIAL PROTECTION, SOCIAL SECURITY, SOCIAL SECURITY SYSTEM, SPOUSE, TAX, UNEMPLOYMENT, UNEMPLOYMENT RATES, VALUATION, VALUATIONS, WILL, WIVES, YOUNG AGE, YOUNG CHILDREN,
Online Access:	http://documents.worldbank.org/curated/en/ https://hdl.handle.net/10986/21112
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